THE REALITY OF INDIAN TRADING BOOM: PLATFORMS GAIN, RETAIL INVESTORS BLEED

Poor financial literacy and a lack of minimal safeguards have left millions of investors at risk

- JAYATU SEN CHAUDHURY & AKHTER M. RATHER

and streamlined user experience. By 2024, they accounted for 36% of industry revenue and 44% of profits—underscoring how a low-cost, high-volume model outperformed traditional players.

Technology meets aspiration India's trading boom is driven by local factors: low data costs, rising smartphone use, and a growing middle class seeking financial independence. For the first time, millions could trade stocks and derivatives on phones, with minimal capital and friction.

A market flooded with inexperienced traders But the excitement of democratization hides an uncomfortable truth. According to Sebi, the number of individual traders in futures and options nearly doubled between 2021-22 and 2023-24. Individuals now make up almost the entire F&O segment—99.8% as of 2023-24. But with this surge came heavy losses. Of 113 million traders during this period, over 105 million—nearly 93%—lost money.